Canadian Farm Cash Flow Up

OTTAWA - Jun 15/05 - SNS -- After declines of 7.1% in 2002 and 28.1% in 2003, cash income rose to $8.1 billion in 2004 led by a 7.0% jump in the sales of primary agricultural products, according to Statistics Canada.

The crop and hog sectors posted the biggest increase in sales. Despite the increase in 2004, the level of cash income was only slightly above the previous five-year average (1999 to 2003). The cattle sector, which was also facing a very difficult period in 2004 because of the BSE situation, saw a small decrease from 2003.

The amount of cash available for investment or withdrawal also increased 20.5% from 2003 to $10.0 billion. However, it remained 2.5% below the previous five-year average which was weighted down by difficult years in 2002 and 2003.

Cash available to producers was expanded through borrowing resulting in a net change in loans outstanding reaching $1.8 billion in 2004.

All provinces recorded increases in cash income, except Prince Edward Island, where a substantial decline in potato prices led to a 6.9% drop in the sales of primary production. Alberta had the largest increase in 2004 after posting the largest decline in 2003 due to the combined effects of BSE and droughts in 2001 and 2002.